AIMIA V21 - David Murray

1 © 2009 IBM Corporation

Building a smarter planet: Media & Entertainment

David Murray - General Manager, Communications Sector18/03/2009

BUILDING ASMARTER PLANET:MEDIA & ENTERTAINMENTNew Business – Not New Media



The need for operating “smarter” in this environment is clear.

100 millionvideo streamsHosted by Yahoo daily in 2007

On the internet by 2010 - 60% will have broad band access

1.6 billion users

74 terabytesOf storage is required for just one hour of feature film in high resolution

Created in 2010 –between digital still cameras and cell phones

500 billion images

60 million blogsOnline today and growing

$100 billion spent On personal digital devices annually

The pace of change is accelerating.



Change Needed Past ChangeSuccess

The way the world works is changing—and leaders must lead through the unknown.

Gap between envisioned change and past success at managing it.

9 in 10Media & Entertainment leaders anticipate substantial change ahead.

53%Change Needed Past Change

Success

M&E

53%2%

94%4% 29%

25%

41%

No/limited Change

Moderate Change

Substantial Change

No/limited Success

Moderate Success

Successful

Global

22%6%

11%

83%

19%

20%

61%

CHANGE GAP*CHANGE

GAP*

Past Change Success

Change NeededPast Change Success

Change Needed



Smart media companies are working toward a framework to create sustained business performance.

SEIZE DIGITAL MARKET OPPORTUNITIES

The need to quickly develop new experiences, content and

channels with agile and flexible business infrastructure

REDUCE COST TO FUND NEW GROWTHThe need to reduce cost of operations by creating a flexible, integrated, scalable infrastructure through open standards-based IT systems.

INNOVATE BUSINESS MODELSDevelop strategies and roadmaps

for new digital realities such as platform-agnostic products and services, pricing strategies and

delivery mechanisms..

CONNECT WITH CONSUMERSEstablish and exploit relationships across channels to deliver next-generation digital products and services.

MEDIA MEDIA



They are doing so by becoming interconnected, instrumented and intelligent.



INTERCONNECTED

People, systems and objects can communicate

and interact with each other in entirely new

ways.

• Almost one third of the world’s population will be

on the Web by 2011.

• Nearly 4 billion mobile phone subscribers

worldwide by the end of 2008.

•All over the world, a growing number of people are

joining online social networking sites with active

memberships forecast to reach over 500M by 2012.

Source: 2008 IBM Digital Consumer Survey. Total responses = 2800 across six countries: Australia, Germany, India, Japan, UK, US

INSTRUMENTED

We now have the ability to measure, sense and see the exact condition of everything.

• The digitally savvy 13-24 year old segment owns an average of 4 to 5 multimedia devices (e.g. music players, iPods, game

consoles, portable game players)

• “Gadgetiers” – early adopters, estimated at 15% of the market – have an average of 7 to 8 multimedia devices

• 40% of consumers are interested in content portability – the ability to view and transport that same piece of content across

devices

INTELLIGENT

We can respond to changes quickly and accurately, and get better results by predicting and optimizing for future events.

• 41% of consumer would increase their use of digital content, online and mobile, if offered a single site with everything they wanted.• 70% of consumer have rated video content online• Close to 60% of consumers are willing to provide information about themselves – such as age, gender, lifestyle or communications preferences – in exchange for something of value.



An opportunity for media and entertainment companies to think and act in new ways.

+ + =

Delivery compelling content and connect connect with consumerswith consumers across channels and in unique ways.

Innovative business Innovative business modelsmodels that seize upon the new digital realities.

Create a flexible flexible business infrastructurebusiness infrastructure and streamline processes to increase efficiency and agility.

Gain greater efficiency and valueefficiency and value with cost effective, environmentally responsible operations.



SMART ISApplying real-time knowledge of consumer preferences to provide better personalization of content and a more compelling experience.

SMART ISSmart is using context information and social networking to optimize the consumer experience.

Smart media: Connect with Consumers.

SMART ISBuilding a complete picture of consumer preferences, interactions and identify rapid changes in demand.

SMART ISMoving away from traditional one-to-many, broadcast-style delivery processes and channels to web-centric business models.



Masters: IBM delivered an immersive, personalized web video experience that increased traffic to the website and establish community of golf patrons. Usopen.com provides fans with near-HD live video, real-time scoring, and customizable player tracking to bring fans closer to the action.

Zuda Comics: IBM delivered zudacomics.com-- a highly interactive consumer experience founded on user generated content, interaction, feedback and incentives.

Maghound: IBM helped build a new subscription-based membership model and online virtual newsstand with home delivery. Named Publishing Innovator of the Year, this site will have a dramatic effect on how magazines attract new subscribers.

Client: IBM Interactive helped Tribune Interactive properties refit their portfolio of publishing templates across over a dozen newspaper properties, design their faceted search interface, and lead the development of user generated content strategies for their websites, to better adapt to the changing nature of the online news business.

Smart media: Connect with Consumers

Need image. Need image.



Smart media: Innovate Business Models

SMART ISHaving the flexibility to introduce new products and services, revamp business processes, and enter or create new markets., as quickly as opportunities appear, or as soon as you happen to envision them.

SMART ISConsolidating and streamlining complex financial processes to ensure successful compliance and regulatory management practices.

SMART ISCreating cost-efficiencies in traditional supply chain in order to continue investment in high-growth, cross-channel distribution.

SMART ISHaving a holistic and trusted view of media assets across the enterprise, and meaningful metadata search and asset retrieval capabilities in order to repurpose and monetize assets.



Tata Sky built a robust, flexible business model and service-oriented architecture-based IT infrastructure to launch its direct-to-home satellite broadcasting services with unprecedented speed - about six months after work began – and crossed the one million connections mark in its first year of operations.

Smart media: Innovate Business Models

Sony Pictures Finance Re-engineering – Application Support: With implementation of shared services to rationalize, optimize and align processes, Sony Pictures realized an estimated 35% reduction in resource costs.

Bharti Airtel: IBM is helping Bharti Airtel transform the way India communicates. Adding an astounding 1.5 million subscribers per month, the company has grown from a small service provider to a market leader. As Bharti’s strategic outsourcer of more than 60 major systems, IBM is enabling their hyper-growth to 50 million subscribers in just 4 years, 6 years ahead of plan.



Smart media: Flexible Business Infrastructure

SMART ISHaving a technology infrastructure that lets you to pick the best solutions from the most innovative industry solution providers and easily “snap” them into your workflow.

SMART ISIncreasing speed to market by being able to quickly configure production and distribution processes to meet your ever-changing business requirements.

SMART ISCombining the power, flexibility and cost advantages of open Information Technology with media industry-specific workflows, to reduce the cost of production and streamline business and content processes.

SMART ISLeveraging business intelligence and planning to improve insight and elevate performance with visibility and control.



The National Football League implemented a digital workflow to optimize content collection, management and use, that has made editing ten times faster, cut tape reviewing from up to three hours to 40 minutes, and quadrupled programming output.

Vlaamse Radio and Televisie: Thanks to the efficiency of its integrated digital asset management solution, built on a layered service oriented architecture, VRT now produces 50% more programming assets.

Smart media: Flexible Business Infrastructure

Fox Business News: IBM brought together diverse and powerful standards-based hardware and software to create a tightly integrated news production environment for the launch of the business cable network, creating the most agile, cost effective and operationally efficient approach to the networks news production workflow.

ProSeibenSat1 Group and IBM have set up the first pan-European digital platform to enable the delivery of TV programming to multiple platforms. IBM will set up a Broadcast Integration Center and modernize core processes and business applications for media enterprises. Expected savings of approximately 50M Euros over the next ten years.

Need image.



Smart media: Value and Efficiency

SMART ISUse of standard IT-based components to dramatically reduced cost compared to proprietary technologies. Significant savings accrue from workflow efficiency, lower fixed cost for storage and storage media, reduced floor space, heating and cooling, and potential labor savings.

SMART ISGenerating efficiency and cost savings to support new investments. Reallocating resources from operations to innovation.

SMART ISImplementing highly automated management functions to deliver IT services and gain resiliency through self-healing, autonomic applications.

SMART ISScaling computing capacity without scaling power, cooling, floor space and management requirements.



Australian Open: IBM helps Australian tennis support more then 100 times typical volume during the event and scale down when the tournament is over – all without the need to make a large and permanent infrastructure investment.

US OPEN: IBM virtualization technology has helped the US Open consolidate their 60 servers to just 6 system p6 550 serves; has reduced energy consumption by 23% and cooling load by 25%. While website visits have increased by 26%, the cost of each visit has been reduced by 38%.

Smart media: Efficiency and Value

High-Def Programming and Storage: IBM has helped Fox Sports implement a digital video storage solution that enables HD content to managed, stored and retrieved faster, more easily and at 1/2th the cost of a traditional broadcast videotape infrastructure.

Trinity Mirror: Is transforming its editorial and advertising processes, and the technology it deploys , to become a leaner, smarter publishing business. The Midlands region is in process of reducing advertising staff by over 30%, while providing improved services. The company anticipates savings of typically over 20% in each region.



The industry must act now; experiencing deterioration in core revenues, pressure on cost models and challenges with digital.

Reductions in Advertising Technology AdoptionDigital Behavior Retail WeaknessConsumer Spend Slows

The biggest risks to the M&E industry from the economic crisis derive from reduced consumer discretionary spending coupled with an advertising pull-back.

M&E enterprises will confront challenges in areas of Cost Take-out, Cross-channel Investment, Regulation/Security, B2B and B2C Demand and M&A/Market Consolidation.

Cost-take out can bring near-term bottom line effects in;• Front-office and back-office efficiencies• Business process effectiveness• Infrastructure optimization• Additional solutions can be implemented for longer-term competitive advantage and business visibility



Thank you

AIMIA V21 - David Murray

Business

Transcript of AIMIA V21 - David Murray